Credit card fraud does not only happen to personal cards. Many business owners have already become a victim of card fraud on their trading accounts. One reason why thief prefer business accounts is that it is believed that business cards come with higher limits. Hence, they can spend as much as they want with just one card.
Even though a credit card comes with protection for the card holder and there is also $0 liability, the way you use it can still affect your credit score. The impact can take a long time to resolve. Protecting your business from credit card fraud means that you have to perform a few methods yourself. This is especially true if you have an online business. To protect your business from fraud, the following steps may help:
Step 1: Watch out for fraudulent activities.
There are a few things that you need to be on the lookout for. These include:
- Multiple orders for expensive products
- Recurrent and several orders from one customer without much interval
- International orders
- Products that are rarely purchased in bulk are now being ordered in large quantities
Many fraudsters buy several products to max out the credit card that they have stolen. They want to acquire everything that they can in just a short period of time. Con artists will prey on your online shop, especially if your business is still new. Make sure you investigate the buyer if the signs given above manifest. This way, you get to decrease your losses because of fraud.
Step 2: Ask for Card Verification Number on all card payments.
Credit cards come with a card verification number (CVN) – the three-digit number found at the back of the card. AMEX cards have four, which are located on the face of the card. Although requiring the CVN is only a small step, it can still serve protection against scams. Only people who have the actual card can read the digits.
Step 3: Require Address Verification System checks.
When looking for a credit card processing company, you should go for one that offers the ability to inspect the address of the card and the buyer. AVS or address verification system lets you determine whether the address provided by the buyer is the same as the address in the record of the card holder. If the customer knows the exact location on file, this can be a small protective measure against card fraud for your business.
Step 4: Contact customer to make sure he or she really ordered products from you.
This is actually one of the easiest ways to find out if the real card holder has made the order. Fraudsters rarely answer the phone or they may give you a random number. If there is no answer, you should still leave a message and ask the person to call you back to verify credit card.
Step 5: Confirm the veracity of the email address.
Some fraudsters would create an email address just to purchase online in bulk. Free email services, such as those from Gmail, Yahoo, and Hotmail are very easy to obtain. For orders made by people in foreign countries, you may not recognize the domain they use. You can perform a search over the web to see if the page looks suspicious. It is important that you do not rely on an email address to find out if the customer’s purchase is legitimate.